As Lebanon’s economy slumps, PM sees refugees as a burden

On June 20, Lebanon’s interim Prime Minister Najib Mikati said Lebanon’s severe economic crisis meant setting priorities, especially to deliver public services to the many in need.

His comments, which coincided with World Refugee Day, came during a meeting to launch the Lebanon Crisis Response Plan for 2022-2023, part of an ongoing multi-billion dollar effort to helping Lebanese in need and the country’s 1.7 million Palestinian and Syrian refugees.

Mikati called on the international community to help Lebanon return the Syrians to their country of origin, warning that otherwise Lebanon will have to return them “by legal means”.

“We are going through one of the most difficult economic, financial, political and social crises in the world,” he said, “which means that Lebanon cannot bear this burden. [refugees] more, 11 years after the Syrian crisis.

The problem is that the refugees are not the biggest problem for the Lebanese economy. Corruption and politics are.

The UN refugee agency (UNHCR) says Lebanon hosts more refugees per capita than any other country. Nine out of 10 live in extreme poverty, COVID-19 and the economic aftermath of the massive Beirut port explosion in 2020. Since 2015, Lebanon has accepted $9 billion in humanitarian aid.

The watchdog group Transparency International gives Lebanon one of the worst corruption scores in the world – just 24 on a scale where 100 is the best.

“Following the Beirut explosion, Lebanon descended into economic collapse and political instability, finding itself without a government for 13 months,” the group said in January 2022.

“Widespread protests by Lebanese citizens against political corruption and economic collapse have been met with persecution and harsh repression of fundamental rights by the authorities, even as the Lebanese political class has failed to confront the ongoing crises.

Many of the country’s wealthy elites were among those identified holding billions in offshore accounts in the 2021 Pandora Papers survey conducted by a consortium of news outlets.

Who is to blame? Refugees have long been the target.

In 2019, Beirut Today, an independent media platform based in Lebanon, reported that politicians were stirring up resentment and discrimination against refugees. The newspaper cites reports of torture, deaths in custody, forced returns, curfews and mass evacuations.

The outlet said the government had adopted tough measures to deter refugees from entering the country, including strict work and residency rules and limited sectors in which refugees could work in agriculture, construction and waste management.

Fast forward to April, when Reuters reported that poverty rates in Lebanon were skyrocketing, with 80% of its population classified as poor. The Lebanese pound had lost 90% of its value, leading to inflation. According to the news agency, savers have lost more than 80% of the value of frozen dollar accounts, sparking the biggest exodus from the country since the 1975-90 civil war.

Lebanon’s ruling elite has controlled the country since the end of the civil war. The government is based on a sectarian power-sharing system that distributes positions among the country’s religious or ethnic groups. The President is a Maronite Christian, the Prime Minister is a Sunni Muslim, the Speaker of Parliament is a Shia Muslim. Lower positions are assigned in the same way.

It’s a system that invites corruption, academics John Nagle and Tamirace Fakhoury wrote in The Conversation after the Pandora leaks became public.

“To obtain health care, food and other basic services, Lebanese citizens often have to turn to their communal leaders rather than to the state,” they wrote. “Political leaders who distribute these services expect their communities to reciprocate by providing support at the ballot box.

“Corruption is therefore essential to the survival of sectarian politics.”

In an analysis for the Middle East Institute, economists Amer Bisat, Marcel Cassard and Ishac Diwan wrote that Lebanon’s economic failure was predictable.

In 2019, people took to the streets to protest government policies and ruling elites’ opposition to reforms. The government resigned, creating a political crisis which, in turn, halted capital flows and squeezed banks. Then came COVID-19 and the explosion in Beirut.

“There was no president between 2014 and 2016, there were multiple and long delays in forming the cabinet, and the 2018 legislative elections were held but only after a five-year delay,” they said. write all three.

“The [former Prime Minister Rafik] The Hariri government that was in place when the crisis hit in 2019 became so powerless that it lacked the power to implement any of the reforms required as a condition of foreign support.

Lebanon has failed to meet International Monetary Fund conditions for a financial bailout, including reforming bank secrecy laws, Reuters reported.

The Pandora Papers revealed that Lebanese officials transferred billions of dollars abroad while ordinary people suffered. The newspapers cite Mikati among them.

Worth over $2 billion, he and his family own a Monaco-based satellite phone company and management company, as well as Panama-based Hessville Investment Inc., which “helped facilitate operations of the offshore company,” reporters reported.

Mikati released a statement at the time saying his holdings were legal and had been disclosed to Lebanese regulators. “Wealth does not necessarily accumulate at the expense of the public good and the needy,” the statement said.

On January 25, the World Bank accused members of Lebanon’s ruling elite of abusing their positions and creating a “zombie-like economy”.

“Lebanon’s deliberate depression is orchestrated by the country’s elite who have long captured the state and lived off its economic rents,” the bank said in a press release. “This capture persists despite the severity of the crisis – one of the top 10, perhaps the three most severe economic collapses in the world since the 1850s.”

The title of the article: “Great Denial in Deliberate Depression”.

“The poor and middle class, who were never well served under this model in the first place, bear the main burden of the crisis,” the bank wrote.

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